Anti Money Laundering Quiz
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Questions and Answers

What are the 4 elements of fraud?

  1. Matter false statement, 2. Know statement is false, 3. Rely on false statement, 4. Financial loss

What is the distinct difference between a fraud and an attempted fraud?

Loss of money

________ _____________ is the process of making illegally obtained proceeds appear legal.

Money Laundering

What two financial statements are usually provided by a business to a financial institution when trying to secure a business loan?

<p>Balance sheet and income statement</p> Signup and view all the answers

________ _________ is a financial statement that summarizes a company's assets, liabilities plus the net worth at a specific point in time.

<p>Balance sheet</p> Signup and view all the answers

Is a financial statement that reports a company's revenue and expenses and profit/loss over a specific period of time?

<p>Income statement</p> Signup and view all the answers

What is a division of the United States Treasury Department whose goal is to prevent and punish money laundering?

<p>Financial Crime Enforcement Network</p> Signup and view all the answers

What is a report that U.S. financial institutions are required to file for each deposit, withdrawal or exchange of currency in excess of $10,000?

<p>Currency Transaction Report</p> Signup and view all the answers

What is a report that financial institutions must file following a suspected incident of money laundering?

<p>Suspicious Activity Report</p> Signup and view all the answers

What is the form that needs to be filed by any person who receives more than $10,000 in cash in a single transaction?

<p>8300</p> Signup and view all the answers

What is the central bank of the United States, founded in 1913?

<p>Federal Reserve</p> Signup and view all the answers

Who was the New York City hedge fund manager arrested in 2008 for operating the largest Ponzi scheme?

<p>Bernie Madoff</p> Signup and view all the answers

Name the world's largest anti-fraud organization.

<p>Association of Certified Fraud Examiners</p> Signup and view all the answers

Name the largest international organization dedicated to enhancing AML/CTF knowledge.

<p>Association of Certified Anti-Money Laundering Specialists</p> Signup and view all the answers

What are the 4 primary financial institution regulators?

<ol> <li>Federal Reserve Board, 2. FDIC: Federal Deposit Insurance Corporation, 3. National Credit Union Administration, 4. Office of the Comptroller of the Currency (OCC)</li> </ol> Signup and view all the answers

What are the 2 primary regulators for Wall Street?

<p>United States Securities and Exchange Commission and Financial Industry Regulatory Authority (FINRA)</p> Signup and view all the answers

Name the 4 largest banks in the United States.

<ol> <li>JPMorgan Chase, 2. Bank of America, 3. Wells Fargo, 4. Citigroup</li> </ol> Signup and view all the answers

Name the three lawful ways in which law enforcement may obtain financial records.

<p>Subpoena, consent, search warrant</p> Signup and view all the answers

Who is Joey Coyle?

<p>He found a large amount of money and tried to launder it.</p> Signup and view all the answers

What is a fraud pyramid?

<p>Perceived pressure, perceived opportunity, rationalization</p> Signup and view all the answers

Name 7 countries that are not allowed in the U.S.

<ol> <li>Libya, 2. Iraq, 3. Iran, 4. Syria, 5. Sudan, 6. Somalia, 7. Yemen</li> </ol> Signup and view all the answers

What are the components of structuring money?

<p>Placement, layering, integration</p> Signup and view all the answers

What does the term red flags refer to in financial transactions?

<p>No ID</p> Signup and view all the answers

What is the Bank Secrecy Act?

<p>Act of 1970 that requires financial institutions to file transaction reports.</p> Signup and view all the answers

What is structuring?

<p>Breaking up money orders into cash and checks</p> Signup and view all the answers

Who is Joey Coyle?

<p>Name of the unemployed longshoreman who found fortune and kept it.</p> Signup and view all the answers

A ______ _________ ________ (____) is a legal term used to describe businesses that transmit or convert money.

<p>Money services business (MSB)</p> Signup and view all the answers

The _______ _________ ____ (___) was created in 1970 to assist in criminal, tax and regulatory investigations.

<p>Bank Secrecy Act (BSA)</p> Signup and view all the answers

What is accounting?

<p>The process of measuring, interpreting, and communicating financial information.</p> Signup and view all the answers

What is OFAC?

<p>The Office of Foreign Assets Control</p> Signup and view all the answers

What is a specially designated national?

<p>Block list for OFAC</p> Signup and view all the answers

Name 10 countries that are not part of the 10.

<p>Canada, Russia, Somalia, Singapore, Japan, Bolivia, St. Maarten, Turkey, Zimbabwe, United Kingdom, Colombia, India, China</p> Signup and view all the answers

Who is Paul Manafort?

<p>Famous individual indicted for lobbying activities.</p> Signup and view all the answers

What is a beneficial owner?

<p>The owner of the account</p> Signup and view all the answers

What does PEP stand for?

<p>Politically Exposed Person</p> Signup and view all the answers

Study Notes

Fraud Elements

  • Four elements of fraud: false statement regarding a matter, knowing the statement is false, reliance on that statement, and financial loss incurred.

Fraud vs. Attempted Fraud

  • The primary distinction lies in the actual monetary loss; fraud involves loss, while attempted fraud does not lead to financial loss.

Money Laundering

  • The process of making illegally obtained proceeds appear legal.

Financial Statements for Loans

  • Businesses typically provide two key financial statements to secure a loan: balance sheet and income statement.

Balance Sheet

  • A financial statement summarizing a company's assets, liabilities, and net worth at a specific point in time.

Income Statement

  • A financial document reporting a company's revenue, expenses, and profit/loss over a specific timeframe.

Financial Crime Enforcement Network (FinCEN)

  • A division of the United States Treasury Department, aiming to prevent and punish money laundering and associated crimes.

Currency Transaction Report (CTR)

  • Required for any deposit, withdrawal, or exchange of currency exceeding $10,000 by U.S. financial institutions.

Suspicious Activity Report (SAR)

  • Filed by financial institutions when there is suspicion of money laundering, fraud, or other legal violations.

Form 8300

  • Must be filed by individuals in trade or business who receive more than $10,000 in cash in a single transaction.

Federal Reserve

  • Central bank of the United States established in 1913, providing a stable monetary and financial system.

Bernie Madoff

  • New York City hedge fund manager arrested in 2008; sentenced to 150 years for operating the largest Ponzi scheme in history.

Association of Certified Fraud Examiners (ACFE)

  • The largest anti-fraud organization providing training and education in fraud detection and prevention.

Association of Certified Anti-Money Laundering Specialists (ACAMS)

  • Largest international membership organization focused on enhancing knowledge in anti-money laundering and financial crime prevention.

Primary Financial Institution Regulators

  • Federal Reserve Board, FDIC (Federal Deposit Insurance Corporation), National Credit Union Administration, Office of the Comptroller of the Currency (OCC).

Wall Street Regulators

  • The two primary regulators are the United States Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

Largest U.S. Banks

  • Notable banks include JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup.

Evidence Acquisition by Law Enforcement

  • Law enforcement may obtain evidence through subpoena, consent, or search warrant.

Joey Coyle

  • Unemployed longshoreman who found $1.2 million on the street in 1981 after it fell from an armored car and decided to keep it.

Fraud Triangle (Fraud Pyramid)

  • Contains perceived pressure, perceived opportunity, and rationalization that can lead to fraud.

Restricted Countries

  • Countries prohibited from U.S. dealings: Libya, Iraq, Iran, Syria, Sudan, Somalia, Yemen.

Structuring Money Laundering

  • Involves three stages: placement, layering, and integration.

Red Flags in Transactions

  • A notable red flag is the lack of identification during financial transactions.

Bank Secrecy Act

  • Enacted in 1970, it requires financial institutions to file transaction reports to assist in investigations.

Transaction Structuring

  • The act of breaking up money orders into smaller transactions to evade reporting thresholds.

Office of Foreign Assets Control (OFAC)

  • Government office that enforces laws regarding economic and trade sanctions against targeted foreign countries.

Specially Designated Nationals

  • A block list maintained by OFAC that includes individuals and entities banned from U.S. dealings.

Exempt Countries from Sanctions

  • Notable non-sanctioned countries include Canada, Russia, and the UK, among others.

Paul Manafort

  • Known for his high-profile lobbying activities and subsequent indictments.

Beneficial Owner

  • The individual who ultimately owns or controls an account.

Politically Exposed Person (PEP)

  • An individual who holds a prominent public position, impacting their risk for involvement in corruption.

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Description

Test your knowledge on anti-money laundering concepts with this quiz. Explore key definitions and elements related to fraud and money laundering. Perfect for those studying finance, law, or criminal justice.

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